Payday loans are very helpful to many in society today. They enable many pay off debts that would otherwise have overstayed and caused problems. For this reason, many states have made cash advance loans legal and set specific regulations to control the industry. However, in the state of Georgia, the loans are prohibited.
Payday loans are illegal in Georgia – a law was passed to that effect in mid 2004 – and this is because of different reasons. However, even with the ban, many lenders have continued to violate the rules which lead them to answer in a court of law. The main reason why the ban has been put is because many lenders have exploited borrowers to great extents.
The high rates on payday loans have been resisted by many and the general public is aware that there are many consequences and penalties that come with breaking the law. However, it is vital to understand what the importance of regulations and laws is with this regard. Different states have not made drastic moves but they grapple with similar challenges.
Interest rates on payday advance can be very tricky and, when it comes to cash advance of little amounts, many lenders are tempted to ask for very high rates sometimes even 10 times what it should be. With this trend, it becomes very difficult to cope and in the case of GA, the Supreme Court had the final word.
Apart from very high rates of interest, there is also the issue of bad debts. The industry in other states even lends to people who have very poor credit history which makes it impossible to find the sanity and some people are committed to a lifetime of debts and loans. Lobbyists against the issuing of payday loans say that the ban has worked in Georgia.
Statistics say that the residents of Georgia have been saved over $350 million in crippling interest loans. Many lobbyists say that since the ban in 1994, many families have refocused and they can direct their hard earned money to things like school supplies and the like.
With a payday loan, it is a bitter sweet story which comes with different sentiments. The residents of Georgia may have been spared the exploitation from cash advance lenders but, how are their needs for quick cash being met? It is definitely a difficult case which is hard to resolve.
A payday loan in Georgia will not see light of day because lenders have abused the platforms and marketed the loans with a hidden motive. All in all, cash advance has continued to be marketed as an emergency option for people in need. However, the reality is very different and with this school of thought, the ban in Georgia is certainly welcome.
For more information on the issues surrounding the ban of payday loans in Georgia, go online. You will discover sites that will help you get a glimpse into the core problems and issues that have been taken into account by the Supreme Court in the state.
You will also get to see how the GA house was split on the decision; to ban payday loans in GA. Some people have called for the lift of the ban but, this still remains an unknown issue.